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C dont do anything without a Strong buy
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is it possible to predict future stock prices
Traders and analysts use a variety of methods to make educated guesses about future stock movements:
You can make probabilistic forecasts, not guarantees. The most successful investors manage risk, not just predictions.
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Predicting future stock prices with certainty is not possible. However, there are methods to make informed predictions or estimates—but they always carry risk and uncertainty. Here’s a breakdown of why:
Why Stock Prices Are Hard to Predict
- Market Efficiency: According to the Efficient Market Hypothesis (EMH), all known information is already priced into stocks. So, consistently beating the market using public info is very difficult.
- Randomness: Stock prices are influenced by random, unpredictable events—e.g., geopolitical crises, sudden economic shifts, or corporate scandals.
- Human Behavior: Markets are driven by investor psychology, which is often irrational and hard to model accurately.
What You Can Do
Traders and analysts use a variety of methods to make educated guesses about future stock movements:1. Fundamental Analysis
- Looks at financial statements, company health, industry trends.
- Used by long-term investors (e.g., Warren Buffett).
2. Technical Analysis
- Analyzes price charts and patterns, volume, and momentum.
- Used by traders looking at short- to medium-term price movements.
3. Quantitative Models & Machine Learning
- Uses historical data, statistics, and algorithms.
- Can identify patterns, but past performance ≠ future results.
- Still sensitive to market regime changes and overfitting.
Important Caveats
- No model is 100% accurate.
- Many models work well until they don't—they may fail in unexpected market conditions.
- Black swan events (rare and impactful) can wipe out even the best strategies.